Safeguarding Intellectual Property in a Southeast Asian frontier market

December 23, 2015 6:11 AM

I am writing a business plan to start a beverage factory in Thailand, and would like some advice on how I can protect my IP (recipe and methodology).

My product is based on a formula and a methodology known only to me that requires many steps and techniques to create, including various stages of fermentation, and it's important that I do all I can to protect my formula, which is my life's work.

The question I pose to you is this:

Realizing that even a contractual agreement protecting my IP is likely not robust enough in this business setting, how do I teach a staff how to make my product, but prevent them from knowing the formula and method, in a way which does not require my presence some, or most, or maybe even all of the time? (I will be travelling to found other factories in a couple of places around the region.)

Indications:

Pretend for a moment that there are no laws actually protecting my formula.

I would also appreciate general advice on doing business in Thailand, and specific advice, and referrals regarding intellectual property contracts and laws germane to Thailand which could help to protect me as well. Also please include anecdotes if they help you to illustrate your point better.

posted by cryptolex to Human Relations (6 answers total)

This is a trade secret. I'm not sure about the practical part of protecting it - hire one person you can trust to supervise? - but there are laws in thailand protecting trade secrets, and you can get damages if it gets out. Bangkok probably has an IP office that you can get more information from.
posted by kinoeye at 8:05 AM on December 23, 2015

Also, next to Singapore and Malaysia, Thailand's IP laws are the most robust. This will be even more so once the trans pacific partnership is implemented. So, good timing.
posted by kinoeye at 8:08 AM on December 23, 2015

I am an attorney (in the US), but I am not your attorney. This is not legal advice.

You should consult an attorney with Thai business and intellectual property experience. This is your life's work. It's worth paying an expert to get expert advice and assistance.
posted by jedicus at 8:14 AM on December 23, 2015

Response by poster: @kinoeye -
1 - no matter what the contract I can still be ripped off if someone modifies 30% of my IP an the slightest of ways. example:

http://www.theguardian.com/technology/2015/jul/18/instagram-artist-richard-prince-selfies

Therefore even if someone does rip me off and I sue them, it just ends up costing a lot but if they're more powerful (or the people they sell the info to are) then they win. You must not forget thailand is a military regime with a corrupt system. If the right person rips me off and I fight them, they could pay someone off or I could end up taking a short trip to a crocodile farm. I'd rather just keep anyone from knowing at all, even my most trusted employee from knowing it completely.

@jedicus -

I certainly am getting attorney and other bodies advice on this. I need to know how to keep people from knowing at all, which is why I posted here.
posted by cryptolex at 9:53 AM on December 23, 2015

Compartmentalize as much as possible. Have Factory A make half the ingredients, Factory B make the other half, and Factory C combine them in the special black-box machine made and serviced only at Factory D.
posted by agentofselection at 3:32 PM on December 23, 2015

The only way to really keep it safe is if only you know it, and maybe one trusted family member knows it. Don't tell anyone. You can't trust Asian IP legal protection much, which is why so many people dislike working there. Don't write the formula down anywhere. Like agentofselection said, split up the manufacturing so that nobody knows the ingredients. For example, you can source products in secret, have them shipped to location A and marked "ingredient X", "ingredient Y," etc. Then send 1/3 of them to secret location B to have them combined, and the same with the other 1/3 in two other locations C and D. Then the mixes B, C, and D are combined in location E and bottled. The less you say about your business, also the better. Don't show up yourself, send a proxy, and give a fake business name and address, and maybe country. Don't even have B, C, D, or E know what your brand is, or tell them a fake brand. Which means you could perhaps have the bottling done separately from the place that does the branding, e.g. applying stickers. It really depends how much you value the secret and how much you're willing to spend. Secrecy comes at a price, so you could really go far with protecting it by spending more. To me, beverages all taste like acidic sugar water anyway, though. Taste matters less than marketing.

Also Google "how Coca Cola has kept their recipe secret" and read all the articles, for example this one and this one.
posted by omg_parrots at 5:26 PM on December 23, 2015 [1 favorite]